Power Profiles

Ultimate Toys Motorsports – Knoxville, TN – Nov. 14, 2005

Ultimate Toys Motorsports
10612 Kingston Pike
Knoxville, TN 37922
(865) 577-6367
Corporate Partnership, Terry Lewis and Bill Lindsey
Current owners Terry Lewis, along with silent partner Bill Lindsey have owned the business for about three years. Formerly Polaris of Knoxville, the store recently moved from a location in south Knoxville to the more affluent community of West Knoxville.
A brand new 24,000-sq.-ft. building now houses the Polaris and Victory dealership, along with Suzuki, Vento, Eton and most recently, Arctic Cat. Prior to Polaris dropping its watercraft line, the dealer was a strong PWC dealer, given its proximity to the Tennessee River.
Ultimate Toys also has a second location in Crossville, TN, about 30 miles west. The current facility features an 8,500-sq.-ft .showroom, along with 8,000 sq. ft. of shop space, 2,500 sq. ft. of parts, plus offices and storage. ATVs and street bikes make up equal percentages of sales; with dirt bikes filling in the rest of the sales mix. Ultimate Toys employs 19 full time employees in Knoxville and three in Crossville.
“Discounting is one of the huge problems that I see,” says Lewis. “Discounters don’t care about service or the customer. They just care about numbers of sales. When you sell $200 into the holdback, you really don’t care. You’re just turning numbers. And that’s OK if you’re running that business model, but I don’t think it does the powersports business any good. Also, big box dealers; Pep Boys, places like that are creating a condition where they sell products they can’t get parts for.”
“GSX-Rs,” says Lewis. “Everybody wants the 1000, but 600s are the strong sellers. Cruisers are a good market; Victorys sell well. On ATV, Polaris Sportsmans are the strongest. The 500 has always been our staple market. Our helmet sales are sky high. We sold more in a month this year than we did all last year.”
“I don’t know that we have a typical customer,” says Lewis. “We have typical customers for the type of product we sell. Our cruisers are the typical 45-year-old family man. Our typical Gixxer purchaser is a college student. Our typical ATV purchaser is a hunter, outdoorsman who’s graduated from the go-fast models.”
In terms of general trends, Lewis says that customers are much more educated. “I think the Internet has a lot to do with that,” says Lewis. “They are a much more savvy buyer. We really have to be on top of the product. You’re not going to fool the customer these days.”
“We’re blessed to have the mountains,” says Lewis. “And north of here is a huge 130,000-acre OHV riding area. Coal Creek is another 70,000 acres. We’re blessed with having the only available public riding area in the state here.”
“It’s significant,” says Lewis. “Probably about 40% of the revenue. Parts is probably about 25% and service is 15%. But, more importantly, being able to take care of our customers in a timely manner. So they don’t load it on the trailer, drive an hour and a half to a riding area, unload it off the trailer and the darn thing doesn’t work. How mad is that guy? Mad enough to go trade it in. We dry hard to get that unit repaired correctly.”
Ultimate Toys has three service technicians, plus a service manager and service writer. The dealership uses a dealer management software package, but Lewis says he’s planning to switch to Lightspeed.
“We do a local radio show on Tuesday nights called Suzuki Outdoor Adventures,” says Lewis. “We talk about hunting and fishing; ATVs. I do all my own commercials.” On top of the radio show, Ultimate Toys runs the gamut of advertising. Drive by traffic is impressive at 50,000 cars a day. “(We do) 30% billboards, 25% newspaper and magazines, 35% radio, 5% direct mail and 5% TV,” says Lewis.
“We do four open houses a year, two spring and two fall. Ultimate Toys also has a strong Web presence. “The Web site is good. It’s been a good generator for us. PowersportsNetwork put it together and we sell parts and units online. It’s huge for the consumers. Our eBay sales are strong; we don’t have any problem getting our used units moved. We used to have new units hanging around everywhere. Now I bet we don’t have five on the lot.”
“To be successful in today’s market, you have to have a death grip on costs,” says Lewis. “Your costs can easily outstrip your revenue stream. Dealers who have been around for thirty or forty years have their infrastructure paid for. Dealers who are growing with a new facility and employees and this and that, their cost is accelerated. So you have to have a death grip on your costs.” psb
—Blake Stranz
If you would like to share your story with the readers of Powersports Business, please contact Blake Stranz at bstranz@comcast.net.

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